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HMRC internal manual

VAT Input Tax

Specific issues: employers who are sole trustees of their pension fund

Most employers separate their pension fund from their business activities by vesting the assets in separate trustees. The employer may, however, act as sole trustee of their pension fund. If they do this any business activities carried on or supplies made by the fund will be made by the employer.

When this happens all tax incurred on supplies received in connection with the fund are received by the employer. Any non-business and exempt supplies made by the fund must be taken into account when the employer works out its VAT recovery.